India’s public expenditure on health in 2015-16 was Rs 1,40,054 crore.
In major states like Uttar Pradesh, Bihar, Rajasthan and Madhya Pradesh, the government’s share in the total health expenditure continues to hover between 1.1-1.3% of gross state domestic product (GSDP), despite a substantial increase in healthcare costs. Public health spending in Maharashtra stood at a mere 0.7% of GSDP in 2015-16, against a total health expenditure of almost Rs 57,000 crore. Consequently, increasing the out-of-pocket burden.
Even in Kerala, where the health indicators are better than other parts of the country, public health spending as share of GSDP is limited to merely 1%, whereas the total health expenditure stood at 4.5% of GSDP.
Jammu & Kashmir accounted for the largest share of public spending on health at 1.7% of GSDP in 2015-16. However, the total expenditure in the state was also high as a percentage of its GSDP at 4.2%.
In Gujarat, the home state of PM Narendra Modi, the government spent 0.8% of GSDP in 2015-16, much below the national average. However, the state also accounted for a comparative total lower health expenditure as percentage of GSDP at 2%.
The data was recently presented in Parliament by minister of state for health Anupriya Patel during the ongoing session.
Around 67.8% of total expenditure on health in India is paid out of pocket. The world average is 18.2%.
This assumes significance as the Centre has proposed to raise the public health expenditure to 2.5% of GDP by 2025.
Experts say the target is too ambitious given the current spending by states and the lack of resources for generating revenue. “There is no doubt that the government needs more investment for creation of healthcare infrastructure but looking at macroeconomic fundamentals, there is very little money whereas the liabilities are huge,” says Sujatha Rao, former health secretary.
Rao says unless the Centre is able to expand the taxpayers ratio and states are able to give around 8% of its revenue expenditure for health, compared with 3-5% currently, it would not be possible to meet the target.
The government expenditure on healthcare has increased to 1.18% of GDP in 2015-16 from 0.96% in 2005-06. In 2014-15, the total expenditure incurred on health as a percentage of GDP was 3.89%, whereas the government share stood at 1.13% of GDP.
At present, the Centre shares around 30% of the total public health expenditure, the rest is borne by states.
With India not meeting its previous public health spending goals, healthcare experts are apprehensive about the current targets. The National Health Policy, 2002, had set a target of 2% of GDP by 2010; the United Progressive Alliance government, in 2004, had set a goal to increase publichealth spending to 2-3% of GDP over a five-year period; and the Centre’s 12th five-year plan set the target at 1.87% of GDP by March 2017.
Despite these targets, India’s public-health expenditure is amongst the lowest in the world, lower than most low-income countries.